Maybe it’s the Annapolitan in me, but when I looked through all the comments from this year’s SDM 100 companies detailing the challenges they had faced in 2021 — and predict to continue facing in 2022 — my mind went immediately to an image of rough seas. I picture the SDM 100 companies as a series of boats — from small fishing vessels to large yachts, and perhaps a cruise ship or freight vessel or two — navigating the open ocean with a variety of storms and problems impeding their way. But — and this is important — they are sailing forward and staying afloat. Admirably, in most cases.
“Overwhelmingly, the supply chain issue came up time and again in every facet of business, from company challenges to successes, to anticipation of the coming year.”
As Titan Alarm wrote, “The market had higher than usual demand during 2021 compared to 2020. It seemed like all segments experienced growth and need. Many clients are increasing security and receiving funds for greater security measures. Supply chain issues affected our profitability (increased cost of acquisition of parts and delayed shipping) along with employee absences. Not only did we not go out of business during the COVID pandemic, but we grew and thrived during the toughest times.”
Overwhelmingly, the supply chain issue came up time and again in every facet of business, from company challenges to successes, to anticipation of the coming year. But it wasn’t the only one. Labor shortages also posed problems for the top 100 security dealers.
“At one point in 2021, we had 21 interviews set up in one day and only one applicant showed up,” wrote DFW Security.
Others pointed to inflation as a big concern.
“We saw cost increases of up to 15 percent due to inflation, surprising us and adding to the complexity of the process,” Advanced Security Systems wrote.
And, of course, the original cause of many of these pain points — the COVID-19 pandemic — was still very much in play in 2021 and continues to be a factor for many of the top dealers.
In spite of these challenges, this year’s group as a whole performed better than last year, achieving 6 percent growth in both aggregate RMR and annual revenue. But many see storm clouds on the horizon, after two years of navigating this pandemic.
There is a strong sense of caution looking at the rest of 2022. The war in Ukraine is an unknown factor at this point, and supply chain problems, labor shortages, and most of the other challenges from 2021 show no sign of going away soon.
Yet, the security industry in general, and the SDM 100 companies in particular, are a hearty bunch who usually weather the storms and come out ahead. In fact, 82 percent of the SDM 100 companies surveyed predict 2022 revenues will be up, in spite of the challenges. Only 1 percent predict they will be down. Given this optimism, I have no doubt that whatever 2022 throws at them, this group will both survive and find ways to thrive.
As All Guard Alarm Systems put it, “At a time where many other companies are struggling, our industry seems to sustain itself during unprecedented times.”